Carrying sales will be Merck's Keytruda drug, used in immunotherapy treatment for cancer. Citi analysts increased their peak sales forecast for Keytruda to $16 billion from $9 billion. Analysts added that Merck's Keytruda success "outperformed [their] initial expectations," as Merck had previously been weak in the oncology business.
Citi added that the "breadth and depth" of Merck's clinical trials with Keytruda is promising and offers a "sustained, significant advantage." In the industry, Citi noted, only Bristol-Myers Squibb Co. (BMY) - Get Report can compete with Merck's "intensive focus."
Citi raised its price target for Dow component Merck to $72 from $65, suggesting a 12% upside for the shares from their opening price Wednesday. Merck stock was higher about 1% to $63.85 in early trading Wednesday. This is the first time Citi analysts have rated Merck stock as a buy.
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